There’s a simple, direct relationship between risk and return. The more risk you take, generally speaking, the greater the potential return. So, while collecting roughly 3 percent a year on a Treasury bill might seem piddling, it’s actually not a bad deal when you consider that there’s virtually no chance you’ll end up losing your investment.
However, for a lot of investors, the excitement and chance at a huge payday make chasing the riskiest stocks well worth it in the end. You might be in a position to lose all of your principal, but you also have some chance to snag what legendary investor Peter Lynch referred to as a “tenbagger” — an investment that generates a return 10 times greater than its purchase price.
If you want to set aside some portion of your portfolio as “fun money” that you can put at great risk while you take some big swings looking for a home run, here are some tricky stocks that could make you rich — if they don’t end up losing most of your initial investment.
- Market cap: $52.4 billion
- Share price high/low over the last year: $389.61/$244.59
- $100 invested on Dec. 1, 2016, would be worth $169.58 today
There’s a whole truckload — or carload — of reasons why a lot of people have doubted and continue to doubt the viability of this company. That said, there’s also a whole carload of investors who have made a lot of money investing in Tesla’s stock. The company’s future — and Elon Musk’s — might be teetering in the balance right now due to lawsuits, but if it tips the right way, investors could be rewarded in a big way.
Advance Auto Parts (AAP)
- Market cap: $11.9 billion
- Share price high/low over the last year: $160.63/$78.81
- $100 invested on Nov. 1, 2017, would be worth $199.18 today
You can be forgiven for being a little surprised to hear that selling spare parts can have such big swings, but Advanced Auto Parts has taken investors on a roller-coaster ride in recent years. Shares were trading at about $80 in mid-2013, spiked to over $200 in November 2015, fell to under $80 a share in November 2017 and has since bounced back to over $160. So, provided you had the nerve to hold on through all of that, you would have about doubled your money in just four years.
- Market cap: $24.7 billion
- Share price high/low over the last year: $47.79/$16.44
- $100 invested on April 17, 2017, would be worth $226.39 today
Any stock trading at less than half the level it was worth two months after its IPO is going to be an iffy bet, but when you consider that Twitter is currently trading at a price that is more than double where it was in April of last year, there’s clearly a reason for jumping in. Anyone hoping for a safe, steady investment has been getting trolled by Twitter’s stock for year, but if you bought at its last bottom, you could have doubled your money in a little over a year.
Incyte Corporation (INCY)
- Market cap: $14.6 billion
- Share price high/low over the last year: $140.11/$60.23
- $100 invested on March 15, 2017, would be worth $45.23 today
If you’re looking for some, ahem, insight into why this stock is so volatile, check out the industry it’s in. Biotech companies are notoriously dependent on the results of clinical trials, with successes and failures usually causing big swings in share prices.
Newell Brands (NWL)
- Market cap: $10.3 billion
- Share price high/low over the last year: $49.24/$20.21
- $100 invested on August 1, 2017, would be worth $41.29 today
Newell Brands — the consumer goods conglomerate responsible for Paper Mate, Sharpie, Elmer’s Glue and Rubbermaid, among other brands — spent over a month trading above $50 a share last summer, an impressive recovery for a stock that was under $10 a share in the aftermath of the housing crisis in early 2009. Mid-2017 was the best time to get out, however, as the stock is worth less than half that much today.
- Market cap: $142.5 billion
- Share price high/low over the last year: $423.21/$164.73
- $100 invested on July 10, 2018, would be worth $78.85 today
Netflix stock has been growing explosively for some time, with shares going from $13.14 at the start of 2013 to over $400 apiece earlier this year. However, any aura of invincibility has taken a hit of late as shares are down over 20 percent since mid-July.
- Market cap: $518.8 million
- Share price high/low over the last year: $24.90/$10
- $100 invested on Oct. 6, 2017, would be worth $50.24 today
Data center company Switch might have some investors hoping someone will trade stocks with them after shares hit a low of $10 earlier this year. Since debuting in early October last year, shares have lost about half their value.
Pilgrim’s Pride Corporation (PPC)
- Market cap: $4.6 billion
- Share price high/low over the last year: $38.39/$16.30
- $100 invested on Dec. 4, 2017, would be worth $49.27 today
A quick look at the stock chart for Pilgrim’s Pride from the start of 2017 to now resembles the Matterhorn in how steeply it gained value — and then how quickly it gave it back up. In less than two years, the stock climbed from $18.65 a share in December 2016 to over $37 a share by early December 2017, and then proceeded to reverse direction and plummet all the way to near where it started.
Scientific Games Corporation (SGMS)
- Market cap: $2.6 billion
- Share price high/low over the last year: $62.80/$29.10
- $100 invested on June 5, 2018, would be worth $50.29 today
Since the start of 2016, Scientific Games — which primarily makes products for the gaming industry — has been on a stunning tear to go from under $10 a share to over $60 as recently as May. However, since hitting that high point, the stock has lost roughly half its value. So, while long-term investors are still probably pretty happy with where they’re at, they might wish they had sold their shares a few months ago. Stock losses like those are usually reserved for casinos.
- Market cap: $16.1 billion
- Share price high/low over the last year: $450.93/$144.01
- $100 invested on Jan. 3, 2017, would be worth $322.61 today
A recent hiccup with medical device maker Abiomed saw shares plummet from highs of over $450 a share to just over $360. However, focusing too much on that swoon when shares started 2017 at just over $110 each would be a little silly — unless you bought at $450, which in retrospect was a huge mistake.
Snap Inc. (SNAP)
- Market cap: $11.3 billion
- Share price high/low over the last year: $21.22/$10.50
- $100 invested on March 6, 2017, would be worth $49.35 today
Facebook has proven that it’s possible to make money from a social media platform. What’s not entirely clear at this point is if anyone other than Facebook can do so. Snap’s failure to realize profits thus far has meant shares are way below where they were immediately after its IPO, but if the company does figure out how to turn profit, this could mean it’s a great chance to buy.
United Rentals (URI)
- Market cap: $12.8 billion
- Share price high/low over the last year: $190.74/$106.52
- $100 invested on Sept. 28, 2016, would be worth $205.54 today
United Rentals — which rents out a variety of heavy equipment — has seen shares swing up and down over the course of the year. However, long-term investors likely find the volatile ride they’ve been on in 2018 more tolerable, given that shares have more than doubled since fall 2016.
Devon Energy Corporation (DVN)
- Market cap: $20.9 billion
- Share price high/low over the last year: $46.54/$29.83
- $100 invested on March 3, 2018, would be worth $128.25 today
Shares in Devon Energy were in a state of freefall earlier this year, plunging from almost $45 a share in late January to around $30 in early March. However, if you had the nerves of steel necessary to watch your investment shed a third of its value in two months without selling, you were made whole. Shares bounced back starting in April and have since climbed back to the levels where they started the year.
- Market cap: $20.5 billion
- Share price high/low over the last year: $20.25/$13.22
- $100 invested on Jan. 2, 2018, would be worth $71.42 today
Mining company Freeport-McMoRan has had a pretty wild ride over the last 12 months. It jumped from under $14 a share in mid-November to around $20 at the start of 2018, and then proceeded to seesaw up and down over the course of the year prior to a final collapse that has shares trading at about the level they were before that meteoric rise in the closing months of 2017. It’s hard to say where the stock is headed next, but if you bought shares at the start of the year, this has likely not been an easy nine months.
- Market cap: $910.6 billion
- Share price high/low over the last year: $1,925/$931.75
- $100 invested on Jan. 3, 2017, would be worth $249.01 today
Apple might be the world’s first trillion-dollar company, but Amazon is fast on its heels. Amazon stock has been rising at an incredible rate for years, with shares more than doubling since the start of 2017. You could say this is one stock that’s really in its prime.
More on Investing
- 6 Small Investment Ideas When You Have Less Than $500
- The Fastest Growing Industries to Invest In
- What $1,000 in Stocks Invested 10 Years Ago Would Be Worth Today
This article is produced for informational purposes only and is not a recommendation to buy or sell any securities. Investing comes with risk, including loss of principal. Always conduct your own research and consider your investment decisions carefully.
All market data is accurate as of market close on Aug. 20, 2018.